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WA governor pressed to veto $1.8B piece of Democrats' tax bill

WA governor pressed to veto $1.8B piece of Democrats' tax bill

Yahoo07-05-2025

Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience.
Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience.
Yahoo is using AI to generate takeaways from this article. This means the info may not always match what's in the article. Reporting mistakes helps us improve the experience. Generate Key Takeaways
Grocers and restaurant owners in Washington are concerned that food prices will rise due to a proposed tax hike that will hit large companies, including food suppliers. (Photo by Justin Sullivan/ Getty Images)
Hoteliers, restaurateurs and grocers are asking Washington Gov. Bob Ferguson to veto part of a tax bill that they say will drive up food costs for them and their customers.
Excising the contentious provision that is counted on to raise hundreds of millions of dollars would knock the budget out of balance, and force Ferguson to call lawmakers back into special session, supporters said.
The debate centers on House Bill 2081, which contains an across-the-board boost in taxes for tens of thousands of businesses, including those in the hospitality and food industries, and a temporary surcharge on some of the state's highest-grossing firms.
The Washington Hospitality Association and Washington Food Industry Association asked Ferguson on April 29 to remove the section imposing the three-year, 0.5% surcharge as it would hit food wholesalers and, when combined with the general increase, be a double hit to consumers.
These groups point out that some of the state's biggest corporations in other sectors, including Boeing, oil refiners, and tech companies, are exempt from the surcharge.
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'Food is not a luxury; it is a necessity. These costs will be passed on to retail operations, meaning the food you buy at your grocery store or meal you buy at your restaurant will undoubtedly increase in price,' Anthony Anton, president and CEO of the Washington Hospitality Association, wrote in the letter.
House Bill 2081 anchors the $9.4 billion tax package Democratic lawmakers put together to balance the next budget and overcome a projected multibillion-dollar shortfall over the next four fiscal years. Lawmakers passed the tax bill in the final days before this year's state legislative session wrapped up on April 27.
A fiscal analysis shows the controversial surcharge would generate an estimated $1.86 billion. Paring that sum would force lawmakers to meet in special session to revise spending in the next budget that begins July 1, said House Majority Leader Joe Fitzgibbon, D-West Seattle.
Fitzgibbon said he has not spoken with Ferguson about this legislation.
House Bill 2081 would affect an estimated 191,000 taxpayers and is projected to bring in nearly $2.1 billion for the budget that begins July 1, and $5.6 billion over four years.
The House bill, which passed over the strenuous objections of Republican lawmakers, would permanently increase the state's two primary business and occupation tax rates on gross proceeds — 0.471% and 0.484% — to 0.5%, starting Jan. 1, 2027. Those would be the first increases to what's known as the B&O tax rate since 1983, according to Democrats.
About 300 taxpayers with more than $250 million in annual revenue would be subject to the additional 0.5% surcharge for three years starting Jan. 1, 2026. That extra tax would be levied on amounts above the $250 million threshold. Among the affected industries are retailers, wholesalers, waste management services, real estate, construction, utilities and health care.
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State officials estimate the surcharge will produce $1.86 billion over four years – $649 million for the next budget and $1.2 billion in the one after that.
About $100 million of the total would come from food wholesalers, according to the association. Another big chunk, about $210 million, would come from health care systems such as Multi Care and Providence, a Washington State Hospital Association representative said.
Anton said the hospitality and food industry associations are not contesting the across-the-board tax increase, only the surcharge, because of concerns over how the doubling of the tax rate for food suppliers will trickle down.
He lamented that attempts to amend the bill to exempt food wholesalers were defeated in the House and Senate by majority Democrats.
Yet, he noted, the Legislature granted exemptions 'to some of the largest companies in the state – tech companies, fuel suppliers, timber companies and others.'
House Bill 2081 exempts manufacturing, retail and wholesale sales of motor vehicle fuel and petroleum products, farmers, some large financial institutions and a select number of high-tech firms paying a special levy to support higher education, including student financial aid.
Boeing is among the exempted manufacturers. Weyerhaeuser and Marathon Petroleum Corp., which operates a refinery in Anacortes, are examples of other well-known companies exempted.
So too are about 160 taxpayers that are assessed the 'advanced computing surcharge.' This levy is applied to firms with global revenue above $25 billion – think Microsoft and Amazon.
The bill would raise the surcharge rate from 1.22% to 7.5% and boost the cap on payments from $9 million to $75 million. These changes could generate roughly $554 million for the next budget and nearly $820 million in the 2027-29 biennium, according to figures shared by the House Democratic Caucus.
Decisions on exemptions were calibrated for fairness and protecting consumers, said Rep. April Berg, D-Mill Creek, chair of the House Finance Committee.
They didn't want to hit the tech giants with two surcharges, she explained.
Refiners were exempted because Democrats also passed an increase in the fuel tax. Exemptions for income earned from the retail sale of food, fuel and prescription drugs not subject to a sales tax are intended to shield smaller businesses and consumers from the impacts, Berg said.
'We were very careful. We've got to make sure our state is on steady ground,' Berg said, adding that she 'hoped our business community responds with calm and not alarm.'
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Five takeaways from New Jersey's primaries for governor: How the candidates are handling Trump and more

Yahoo

time29 minutes ago

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Five takeaways from New Jersey's primaries for governor: How the candidates are handling Trump and more

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New Jersey primaries: Trump-backed Ciattarelli wins GOP nod; Sherrill wins Dem nomination
New Jersey primaries: Trump-backed Ciattarelli wins GOP nod; Sherrill wins Dem nomination

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timean hour ago

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New Jersey primaries: Trump-backed Ciattarelli wins GOP nod; Sherrill wins Dem nomination

One in a pair of states with a gubernatorial race this year, New Jersey hosted the more competitive of the two primaries Tuesday night. Five Republicans and six Democrats vied to represent their party in the November general election. Yet, despite the crowded fields, both races were called within an hour of polls closing. Jack Ciattarelli, who had President Donald Trump's backing, walked away with the win among Republicans, and Rep. Mikie Sherrill came out victorious against her fellow Democrats. Ciattarelli has run in the last two gubernatorial races in New Jersey, coming in 3 points behind current Gov. Phil Murphy in 2021. The outcome between Ciattarelli and Sherrill is highly anticipated even beyond the Garden State, as a potential national bellwether ahead of the 2026 midterm elections. New Jersey voters have picked their nominees for governor. Now, attention turns south to Virginia. The commonwealth will host their primaries the following week on June 17. But unlike New Jersey, there won't be much jostling for a spot at the top of the ticket. Only two of the six statewide primary races are competitive this year, both on the Democratic side. In the governor's race, Democrat Abigail Spanberger and Republican Winsome Earle-Sears have each had their party's nomination since April. -- Savannah Kuchar EMILY's List, a group focused on electing Democratic women to office, endorsed Sherrill in the primaries and celebrated her win Tuesday. 'This is a time for tough leaders, and Mikie Sherrill is as tough as they come,' EMILYs List President Jessica Mackler said in a statement, adding, 'At EMILYs List we are proud to have stood with Mikie since her first campaign, and we're thrilled to support her all the way to victory in November.' Sherrill is now one of two women representing the Democratic ticket for governor in 2025, along with former Rep. Abigail Spanberger, who locked her nomination in Virginia back in April. The pair began their congressional careers the same year in 2019 and share a more moderate reputation. The Democratic National Committee, who did not endorse a candidate in the New Jersey primary, also congratulated Sherrill. 'The DNC is all hands on deck to ensure the Governor's office and Assembly remain blue in November,' DNC Chair Ken Martin said in a statement. 'We will do everything in our power to unite the party and defeat Republican extremists like Jack Ciattarelli.' -- Savannah Kuchar Shortly after Ciattarelli clinched the Republican nomination for governor, the Democratic Governors Association released a statement bashing the former state legislator over his endorsement from the president. 'Ciattarelli's about-face to unequivocally embrace Donald Trump and his refusal to stand up to his party's extreme, costly, and unpopular agenda are too extreme for New Jersey,' said DGA Senior Communications Advisor Izzi Levy. 'Between now and November, we will make sure voters remember why they rejected his last two statewide bids.' Ciattarelli is a previous Trump critic turned presidential endorsee. In 2015, he called Trump a GOP 'charlatan.' This year, in Ciattarelli's third run for governor, Trump offered his full vocal support, including in a telephone rally with voters. Republican State Leadership Committee President Edith Jorge-Tuñón congratulated Ciattarelli in a statement Tuesday evening, and said, 'With New Jersey Republicans rallying around Jack Ciattarelli, we are well positioned to hold Democrats accountable for their poor record and work to deliver the real change that has been promised.' -- Savannah Kuchar Mikie Sherrill, a former Navy pilot and federal prosecutor, has won the Democratic nomination for New Jersey governor, according to projections from The Washington Post and the Associated Press She beat out five party competitors, in what was the most competitive gubernatorial primary this year. Sherrill is will face Republican Jack Ciattarelli in the November general. -- Savannah Kuchar Jack Ciattarelli won the GOP nomination in New Jersey's 2025 gubernatorial election, as results from the primary trickle in. The race was called by the Washington Post and Associated Press shortly after polls closed. He earned Trump's backing in May and came into Election Day with a strong frontrunner status. Ciattarelli previously served as a member of the New Jersey general assembly and has run two prior campaigns for governor. In 2021, he came within 3 points of unseating current Gov. Phil Murphy, who is now term limited. – Savannah Kuchar More: Trump-backed candidate wins Republican nomination in New Jersey governor's race Polls are now closed in New Jersey's 2025 primaries. Results are expected later this evening and will determine both parties' nominees for governor. Republicans may have their nominee sooner, with former state assemblyman Jack Ciattarelli polling well ahead of his GOP competitors. -- Savannah Kuchar Polls will close in New Jersey at 8 p.m. ET on June 10. Once voting is over, New Jersey Republicans and Democrats alike will wait to learn who their official nominee for governor is in 2025. Those nominees face off later this year on November 4. – Savannah Kuchar New Jersey is one of two states with a gubernatorial race in 2025, along with Virginia. Both states typically hold their state elections in off years, between presidential and mid-term elections. This year, they are widely viewed as the first real temperature check on voters' moods and key issues since November 2024. Following the June 10 primaries in New Jersey, Virginia will host theirs June 17. While New Jersey has a crowded field of candidates vying for the governor's mansion on both sides of the aisle, Virginia's top of ticket race has been set since April. Former Rep. Abigail Spanberger, a Democrat, will face Virginia's Republican Lt. Gov. Winsome Earle-Sears this fall. – Savannah Kuchar One area where Democrats vying to be New Jersey's next governor seem to agree are opposing President Trump's response to the anti-ICE demonstrations in California. The president's move to deploy Marines and the National Guard has sparked arguably the most significant showdown with a Democratic governor since his return to the White House. California Gov. Gavin Newsom on Tuesday, for example, filed an emergency motion seeking to limit the use of troops. On the New Jersey campaign trail, Sherrill and Gottheimer condemned Trump and defended Newsom's actions, according to Fox News. Baraka, as has been mentioned, has already made headlines after being detained outside an ICE facility last month. He has filed suit against the U.S. Attorney in New Jersey, claiming it was 'false arrest, malicious prosecution and defamation." New Jersey Education Association President Sean Spiller, one of the longshot contenders, said in a June 9 post on X that if elected he wouldn't 'bend down' to Trump's tactics. 'What's happening in the streets of (Los Angeles) is not normal and we shouldn't act like it is,' Spiller said. 'From ICE tearing apart families to the President sending out the National Guard -- over the objection of the Governor -- and now apparently contemplating deploying Marines on our people - we have to stand up in solidarity and defend our democracy.' — Phillip M. Bailey Trump has owned property in Bedminster, New Jersey, since 2002. However, the president is not expected to vote in the Garden State's election. In the 2024 presidential election, Trump cast a ballot for himself from Palm Beach, part of Florida's 22nd Congressional District. USA TODAY has reached out to the White House to confirm Trump is still registered to vote in the Sunshine State. A recent inspection at Trump's ritzy golf club, located on 500-plus-acres in central New Jersey, found more than a dozen health code violations. According to a May 6 report, raw meat was improperly refrigerated, some handwashing stations lacked soap and the person in charge failed to "demonstrate knowledge of food safety." -- Savannah Kuchar and Zachary Schermele One political figure you'd think would have a lot to say about picking the Garden State's next leader is Republican Chris Christie, whose brash-style pre-dated the Trump era. The verbose former governor, who led New Jersey from 2010-2018 and twice ran for president unsuccessfully, hasn't endorsed anyone in this year's contest. He also was quiet across his socials as voters flocked to the polls Tuesday. Asked last week if he planned to support anyone, Christie told The Star-Ledger: 'I haven't decided yet.' Christie mentioned having a 'great working relationship' with Brammick, a Republican state legislator, but he mostly warned the GOP that independents -- who will be critical in the fall for any Republican -- may sour on Trump by the fall. 'If those independents have become disenchanted with what's happening in Washington under Donald Trump, that will put a significant headwind onto Republicans,' he said. — Phillip M. Bailey Rep. Mikie Sherrill is the frontrunner coming into Tuesday evening. In a May poll by Emerson College and The Hill, Sherrill was ahead with 28% of voters' support. She faces Jersey City Mayor Steve Fulop, Newark Mayor Ras Baraka, and fellow member of Congress Josh Gottheimer, all of whom were sitting at 11% support in last month's poll. New Jersey Education Association President Sean Spiller and former state Sen. President Steve Sweeney are also in the running. -- Savannah Kuchar This race is particularly important for national Democrats because it will be the first major competitive primary since their shattering defeat in the 2024 presidential race. A poll conducted by Emerson College in May found among registered Democratic voters, Sherrill had a solid lead with 28%, but another 24% were undecided. In the last weeks of the race she has faced attack ads for accepting donations linked from a corporate PAC tied to SpaceX, which is owned by Trump 'frienemy' Elon Musk. Newark Mayor Ras Baraka has pitched himself as the candidate most willing to take on Trump. He was thrust into the national spotlight in May after a confrontation with U.S. Immigration and Customs Enforcement at a federal facility But if electability remains a worry then N.J. Democrats may bet on a safer choice such as U.S. Rep. Josh Gottheimer, who co-founded a bipartisan group dubbed the "Problem Solvers Caucus" that tries to sniff out consensus in Congress. Others in the race, such as Jersey City Mayor Steve Fulop, are looking for an opening, too. He's been running as a 'pragmatic progressive' for voters fed up with the state's political machine. — Phillip M. Bailey Current New Jersey Gov. Phil Murphy, a Democrat, is term-limited and cannot run again in this year's race. Murphy has served as top official in the state since 2018 and will conclude his second consecutive term next January. His absence from the race leaves the contest wide open for either party to claim the governor's mansion. The president first announced his support for Ciattarelli in a Truth Social post on May 12. 'Jack Ciattarelli is a terrific America First Candidate running to be the next Governor of a State that I love, NEW JERSEY!' Trump wrote. 'Jack, who after getting to know and understand MAGA, has gone ALL IN, and is now 100%' The two have not always been the best of buds publicly. In 2015, Ciattarelli called Trump a "charlatan." Then in his second campaign for governor in 2021, he kept the then-former president at arm's length. Bygones appear to be bygones, though. Trump told voters in a telephone rally on June 2 Ciattarelli "is the most experienced and battle-tested" candidate. This article originally appeared on USA TODAY: Recap: Ciattarelli, Sherill wins nominations for governor in NJ

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